Pages

The Great Austerity Swindle!

By Joe Firestone
Our Congresspeople, corporate CEOs, tea partiers, most economists, Pete Peterson’s minions,
and even our President, tell us that we’re running out of money; and
that if we can’t keep running huge deficits, and increasing our national
debt forever, because eventually, our creditors will just cease lending
us our dollars back.They also tell us that the Government can
only raise money by either taxing or borrowing, and that when it comes
to taxing, we can’t tax “the job creators” very much or they’ll go on
strike and won’t create any jobs because we’ll have killed their
incentive. So, here we are, we have to reduce our borrowing, and we can
have hardly any tax increases on “the job creators,” so what’s a
fiscally responsible nation to do?
Well, they say, clearly “we” have to lower taxes on “the job
creators” even more, raise them on the “unproductive” 47% or is it the
99%? And also, cut spending substantially on programs that provide
benefits for the poor, the middle class, and even the 99%, so we can “. .
. live within our means,” and remove the burden of excessive public
debt on our grandchildren.

But, what if we say to these people, well, “the job creators” aren’t
making any jobs? That’s a fact! They give all kinds of excuses, but the
truth is that they have no sales, so they have no incentive to create
any more jobs.

On the other hand, the more we lower their taxes, the more money they
have sitting idle, and the more they have an incentive to use that
money to invest in financial manipulation schemes rather than jobs. So,
why not tax them at extremely high rates on net profits and provide
them an incentive to lower their net profits by spending more of their
gross profits on tax-deductible business expenses like employees and
business expansion? Why won’t high taxes on them do more to create jobs
than lower taxes? Didn’t we have far lower unemployment rates when
marginal tax rates were sky-high, than we have now when they are a
pittance on the wealthy?

And what if we say to them, well, Congress can always reorganize the
Federal Reserve so that the regional Fed Banks are nationalized and both
they and the Board of Governors are placed under the authority of the
Secretary of the Treasury, so that the Secretary is empowered to create
reserves out of thin air to fill the Treasury’s spending account, and
keep it filled with sufficient funds to repay the national debt and
cover the deficit without borrowing? And what if we tell them further,
that we know that Congress has the Constitutional authority to do this?
And what if we ask them, why doesn’t it do this, and get the national
debt that you, our leaders, are so worried about, paid off, and keep us
debt free? And what if we ask them still further, and if you do this
then why would we have to have any spending cuts or tax increases, at
all?

And what if we say to them, we also know that to pay off the national
debt and cover the deficits for years to come; it isn’t even necessary
for Congress to reorganize the Fed, because the Treasury can use the Fed
to create money in Treasury’s account from seigniorage? What if we say to them that all that’s necessary is for the President to mint a High Value Platinum Coin (HVPC) with a face value of $60 Trillion dollars,
deposit it at the Fed, and then begin to pay off the national debt and
implement deficit spending using the electronic credits created in the
process of seigniorage?

And what if we say to them, we also know that it is a myth that the
Federal Government can only get money for spending from taxing or
borrowing because Congress can modify the laws, as just described, so
Treasury can generate US money out of thin air, just as the Fed does
today, that Treasury can use to pay down the debt and cover deficit
spending.

And what if we say to them, we know that you’ll say that this is
“printing money” and will cause inflation? But what if we then say,
sorry, but we know very well that it will not cause inflation; because reserves issued unaccompanied by debt are no more inflationary than reserves issued along with debt and,
most importantly, we also know that if you legislate the ability for
Treasury to do this, then you won’t have to worry about the deficit and
debt or our grand children anymore; and we won’t have to worry about
your cutting safety net and other necessary programs anymore?
And what if we say to them, we also know that it is a myth that the
Federal Government can only get money for spending from taxing or
borrowing, because the President can use Platinum Coin Seigniorage (PCS) to
harness the power of the Fed to generate reserves that end up in the
Treasury General Account (TGA), and Treasury can then use the reserves
to pay down the debt and cover deficit spending?

And what if we say to them, we also know that this won’t cause
inflation for reasons stated above, and, most importantly, we also know
that if Treasury does this on orders of the President, then you won’t
have to worry about the deficit and debt or our grand children anymore;
and we won’t have to worry about your cutting safety net and other
necessary programs anymore either?

And what if we tell them that, for all the reasons indicated in these
questions, we also know that all your reasons for wanting to reduce the
deficit and impose austerity on the 99% are bogus? We don’t know which
of you believe in these reasons and which of you do not. But this isn’t
as important as it seems, because we know that the debt commissions, the
debt ceiling crises, the fiscal cliff, the sequestration, the
continuing resolution, budgetary crises, and the constant propaganda
campaign from all of you directed at all of us, is a grand “shock
doctrine” process attempting to swindle us out of a government that
works for 99% of us rather than the 1%. We know that “the Grand Bargain”
is “the Great Betrayal”! And we won’t have it!